Posted 05/05/2017

There are many steps involved when purchasing a home. An appraisal is one of them required by the lender to find the “value” part for the Loan-to-Value calculation of the mortgage. An appraisal is not just to protect the lender but also protects the buyer from paying too much for a home.

A home appraisal is an unbiased report done by a certified, state-licensed professional who determines the value of a piece of real estate based on comparable sales in the neighborhood or closely surrounding areas.  Comparables or “comps” are similar homes that have recently sold either in the general area or that specific neighborhood. Appraisers will look for homes with similar characteristics of the subject property home that have been listed and sold within the past three to six months.

Appraisers will look at the following:
Home exterior – The foundation, roof, siding, gutters, and soffits will be looked at for leaks, defects, cracks, and any deterioration.

Size of the property – Both the lot size, home size, number of rooms and bathrooms are important considerations for the appraiser.

Condition of interior – Appraisers will be looking at the condition of the windows, doors, flooring, walls, plumbing, electrical, kitchen, and bathrooms. They will also take note of the condition of the appliances and light fixtures.

Home improvements – Any improvements – new flooring, kitchen or bath remodel, new HVAC –  to the home since the last appraisal will be of value in the appraisal.

How much does an appraisal cost?
An appraisal can range from $400 to $750 depending on the size, location, # of units (duplex/triplex), or if the property is being used as a rental/income-generating property. Although the lender requires the appraisal, the buyer is responsible for the cost.

What if the appraisal does not support selling price?
There are a couple of things that can happen. If you’ve reviewed the appraisal report and feel that there are some inaccuracies, you can appeal. This will involve your lender and possibly the real estate agent. You’re now working as a team to find things that may have been overlooked. On the flip side, if the report is accurate and there is a significant difference between the selling price and appraised price, you can renegotiate the sales price, walk away from the deal or bring more cash to the closing. Your lender’s not going to finance more money for a higher loan amount if the appraisal came in lower than expected, so you’ll have to make up that difference yourself.

Keep in mind…
Emotions run high and low during the home buying process. Wait for the offer to be accepted, wait for the mortgage approval and wait and hope the appraisal report supports the sale price. But, the home buying process is designed to protect you so if things don’t work out the first time around, it may not have been the right house, the right time or right neighborhood for you.

Mortgages Unlimited is a local mortgage company serving not only the Twin Cities but also, South Dakota and Wisconsin. Minnesota Housing programs are not available in South Dakota or Wisconsin. We work on the behalf of our clients ensuring they are getting the best possible loan while providing outstanding customer service.

Give one of our Mortgage Consultants a call @ 763-416-2600 if you are looking to purchase a home or refinance your existing home loan. Or you start a secure online application at www.muiapply.com.

 

Posted 05/09/2016

concept of mortgage and savings

An FHA loan is a mortgage loan that is insured by the Federal Housing Administration (FHA). Essentially, the federal government insures loans for FHA-approved lenders in order to reduce their risk of loss if a borrower defaults on their mortgage payments.

FHA loans have become very popular because the requirements are less strict than conventional loans. Borrowers can qualify for an FHA loan with a down payment as little as 3.5% and a credit score of 580 or higher.  Keep in mind that the lower the credit score, the higher the interest borrowers will receive.

Benefits of FHA Loans:

Typically, an FHA loan is one of the easiest types of mortgage loans to qualify for because it requires a low down payment and you can have less-than-perfect credit. For FHA loans, down payment of 3.5 percent is required for maximum financing.

Borrowers who cannot afford a 20 percent down payment, have a lower credit score, or can’t get approved for private mortgage insurance should look into whether an FHA loan is the best loan solution for them. Even with a credit score between 500 – 579, a borrower may qualify for a home with 10% down.

Mortgage Insurance Required

Because an FHA loan does not have the strict standards of a conventional loan, it requires two kinds of mortgage insurance premiums: one is paid in full upfront -– or, it can be financed into the mortgage –- and the other is a monthly payment. Also, FHA loans require that the house meet certain conditions and must be appraised by an FHA-approved appraiser.

Two Types of Insurance Required:

Upfront mortgage insurance premium (UFMIP) — This one-time, upfront premium payment due at the time of closing. Borrowers also have the option to roll this into their mortgage. The premium is  1.75% of the home loan, regardless of their credit score. Example: $250,000 loan x 1.75% = $4375.00.

Annual MIP (charged monthly) — This annual premium is actually a monthly charge that will be figured into your mortgage payment. The amount of the mortgage insurance premium is a percentage of the loan amount, based on the borrower’s loan-to-value (LTV) ratio, loan size, and length of loan. Also, the duration of your annual MIP will depend on the amortization and LTV ratio on your loan origination date.

To find out more about the terms of an FHA loan and if it is the right loan for you, contact a Mortgage Expert at Mortgages Unlimited at 763-416-2600 or go to www.muihomeloans.com.

We are celebrating our 25th Anniversary in 2016. Enter our Celebrate25! Sweepstakes for a chance to win $25,000!

NO PURCHASE NECESSARY. Purchasing or closing a mortgage will not improve your chances of winning. The Celebrate 25! Sweepstakes is open to legal residents of MN & WI, age 18 or older. Void outside of MN & WI, in Puerto Rico, and where prohibited by law. Sweepstakes begins at 12:00:01 AM CT on 01/15/16 and ends at 11:59:59 PM CT on 12/31/16.  Click here for entry details and Official Rules. Sponsor: Mortgages Unlimited Inc., 7365 Kirkwood Ct., Ste 300, Maple Grove, MN 55369.

*Prize to be awarded as a cash payment.

 

 

Posted 01/14/2016

stage

Staging can influence buyers’ perceptions of a home and even the home’s perceived value. Just put yourself in a buyers’ shoes. You walk into a home that is professionally staged. You’re so enamored with the décor that it is possible you don’t see some of the little quirks about the house. Say one of the rooms is oddly shaped but the stager chose the right furniture to bring the room together. If the house down the street has the same floor plan with no furniture, a buyer may have a hard time picturing what to do with the odd space and view it as wasted space.

Buyers look for useful space and there are many, many people who do not have the natural ability or creativity to see beyond what is in front of them. This could deter a buyer from considering your home.

If it is a sellers’ market, you may be able to get away with not preparing your house with a professional stager. However, you’ll still want to be sure the house appeals to the masses by doing some of the basics below:

Declutter – Too many things on the kitchen counter can make a kitchen look smaller just as in any room. Remember, when you move into your next home, you can live as you like but buyers need to be able to see their own furnishings in your home.

Fresh coat of paint – Neutral everywhere

Clean – Can’t stress this enough.

De-odorize – Buyers don’t want to know what you ate for dinner the night before or if you have animals.

De-personalize – Too many pictures or trinkets can be distracting.

Less is more – If you have a lot of furniture, take some pieces out and put in storage. You want the rooms to appear larger.

Curb appeal – Paint front door, clean up yard and remove any junk in yard.

These are pretty simple things you can do that won’t break the bank.

In a competitive market, these steps are absolutely necessary but you may want to take it a step further by a hiring a professional stager. Will it make a difference? I believe so. Walking into a beautifully staged home can make all the difference in the world. Look at the two pictures below. They each evoke a different feeling and they are the same room. An empty home can easily lose a feeling of warmth.

lori 1  lori 2

Photos courtesy of Lori Bergeron with Bergeron Homes & Development, Inc.

Notice the neutral background, the pop of color by adding art and throw pillows. That is one of the biggest secrets from designers. Add color with accessories. The big pieces should be neutral and decorated around.

A note from Professional Interior Designer, Stager and Realtor, Lori Bergeron:

My number one tip I have learned to tell Sellers who want to attempt to stage their home themselves is……   TAKE PICTURES!
Go outside and take pictures of the front and back of your home, take pictures of every room inside, and look at them and it makes it easier to see what needs to be done.  When you think you have it ready, retake the pictures and send them to friends and family that will give an honest opinion, and finally compare them with current listings of homes in your price range.  And remember, you can always hire a Professional Home Stager.
You can find more of Lori’s work at www.bergeronhomes.com

Mortgages Unlimited is a local mortgage company serving not only the Twin Cities but also, South Dakota and Wisconsin. We work on the behalf of our clients ensuring they are getting the best possible loan while providing outstanding customer service.

Give one of our Mortgage Consultants a call @ 763-416-2600 if you are looking to purchase a home or refinance your existing home loan. Or you start a secure online application at www.muiapply.com.

 

 

 

Posted 01/14/2016

refinanceWhen considering a rate and term refinance and whether it is right for you, you need to know how much you are saving per month after the refinance, how much your closing costs are, and how long you plan on being in the house. Once you have this information, you can determine if a refinance is right for you.

The table below is based on a scenario where we are refinancing a $200,000 mortgage with a 5.25% interest rate. We are assuming $4000 in closing costs that are being financed in the new loan. You can also choose to pay this at closing and not finance it but many people choose to roll the costs into a new loan amount in order to minimize the money they pay out of their own pocket.

Picture1

As you can see, we are saving exactly $100 each month and it cost us $4000 to refinance. It will take us 40 months or 3 years and 4 months to recoup the closing costs via the monthly savings. If we were planning on remaining in the home for 4 years this refinance would benefit us as we would have recouped all of our costs just after the third year in the home and continue to save $100 each month after.  If we were only planning on staying in the home 2 years, we would not recoup all of the closing costs.  While we are saving $100 each month, it would not benefit us in the long run to refinance if we were only remaining in the home for 2 years as we would only recoup $2400 of the $4000 closing costs.

The simple formula for determining if refinancing is right for you is to divide your closing costs by your monthly savings. This will give you the months needed to recoup the closing costs. As long as you plan on being in the home longer than it takes to recoup the closing costs, a refinance will benefit you in the short term in the form of monthly savings and continued long term savings once the closing costs are recouped.

Mortgages Unlimited is a local mortgage company serving not only the Twin Cities but also, South Dakota and Wisconsin. We work on the behalf of our clients ensuring they are getting the best possible loan while providing outstanding customer service.

Give one of our Mortgage Consultants a call @ 763-416-2600 if you are looking to purchase a home or refinance your existing home loan. Or you start a secure online application at www.muiapply.com.

 

Posted 09/22/2015

winter

If you’re living in a place like Minnesota, then you know that with the change of seasons comes home preparation for the coming season. These tips can help you save money on utilities and protect your investment.

Turn off exterior faucets – Pipes with water left in them can freeze and burst. Disconnect all garden hoses and drain the water that remains in faucets.

For homes more than ten to 15 years old, you will have to turn off the shut-off valve inside your home.

Drain your lawn irrigation systemDraining sprinkler-system pipes, as with spigots, will help avoid freezing and leaks. Just be sure to have a professional do this.

Clean, repair or replace gutters Replace missing gutters or repair damaged gutters and fascia boards. If your gutters are full of debris, water can back up against the house and damage roofing, siding and wood trim — plus cause leaks and ice dams.

Have heating system inspected – You don’t want to find out you could have avoided having to replace your furnace in the middle of winter by simply having your furnace inspected. Hire a certified contractor to do the inspection to make sure no repairs are needed.

Roof Check – Inspect roof for missing or loose shingles to avoid leaks from melting snow. Also, check and repair breaks in the flashing seals around vent stacks and chimneys.

Hire a Chimney Sweep -That time of the year is right around the corner. The warmth and glow of a the fireplace sounds so inviting! But you’ll want to enjoy this without risking a chimney fire or carbon monoxide leaking into your home.

Winterize your windows and doors – Re-apply exterior caulk if there are gaps between siding and window or door frames . Silicone caulk is best for exterior use because it won’t shrink and it’s impervious to the elements.

Check window-glazing putty, too ( it seals glass into the window frame). Add weather stripping as needed around doors, making sure you cannot see any daylight from inside your home.

Owning a home comes with a lot of maintenance. Having a home maintenance calendar will help keep you on track and know what to expect when the seasons are changing.

If you are purchasing a new home or looking to refinance your existing loan, give Mortgages Unlimited a call at 763-416-2600 or visit us at www.muihomeloans.com. Ask about our zero down payment home loans.

 

Posted 07/27/2015

Young couple man and woman stressed over family budget

Are you having a hard time getting qualified for a loan because of your student loans? Student debt after college is over $28,000 on average.  That’s a pretty big debt to take on fresh out of college making it hard for a new graduate to start building equity with a place of his or her own.

There is no easy fix unless Mom and Dad are going to pay off your debts. If that works, kudos to you! But not everyone has that option. Understanding what a lender is looking for will help you set goals to pay down your debt to qualify for a mortgage.

Debt-to-income ratio

A debt-to-income ratio (DTI) is one way lender measure an individual’s ability to manage monthly payment and repay debts. DTI is calculated by dividing total recurring monthly debt by gross monthly income.

To qualify for a mortgage, lenders are looking for a 43% DTI or lower. A debt-to-income ratio smaller than 36%, however, is preferable, with no more than 28% of that debt going towards servicing a mortgage.

Your Credit

You will not be able to purchase a home with a really poor credit score. Pay your bills on time at all times. If you have a temporary hardship, contact your debtors to see if they will work with you. Most will and would rather see you making an effort than completely default on payments.

Believe it or not, even potential employers will look peak at your credit before hiring you.  Be sure to work diligently at keeping your credit in good standing.

Those are the two main concerns for you as of now. Once, you find yourself in a better position to qualify for a mortgage, you will also want to make sure you are mentally prepared to own. 

Some advice for you

Paying down your debts is obviously going to help you tremendously before you run out and try to get approved for a mortgage. If you are motivated to purchase a home, you will have to do some serious budgeting. Give yourself an allowance for the necessary things and to have fun, but not too much fun!

You must know where every penny is going. If your treat is a Starbucks coffee every day, you might want to rethink that. Say you buy a coffee once a day. $3.95 x 7 = $27.65 x 52 weeks = $1437.80. Wow!! That’s a lot of money for coffee. So many people make two trips a day. You can go to the store and buy a bag of coffee for $6.99 that could last a month. Plus creamer for a couple bucks. You get the picture, right?

Remember you are saving for a down payment and trying to pay down bills. Discipline!

Consider getting a part time job. This is two-fold. You can use as additional income if that is the reason you cannot qualify for a home loan. Your DTI may be only slightly off and you just need more income.  Be sure to have the job for several months before applying for a mortgage. Or you can strictly use the money to pay down your debt and apply for a mortgage when you owe less.

If you’d like to speak to one of our Mortgage Professionals at Mortgages Unlimited, please give us a call at 763-416-2600 or visit us online at www.muihomeloans.com. 

 

 

 

 

 

 

 

Posted 07/20/2015

splitting house

Refinancing your home is typically a choice you make to reduce your monthly payment by taking advantage of a lower rate from what you currently have. There is a time when refinancing isn’t a choice but a necessity.

If you’re going through a divorce and both names are on the mortgage, refinancing is your only option to get a spouse’s name off of the mortgage.

There are several things to consider when going through this trying time.

Determine who is going to stay in the house.

Every situation is different. Some will feel it’s best to sell the property, split the profit and move forward. If you have children, the spouse with primary custody may choose to live in the house and keep the kid’s life as normal as possible. This can work, but you’ll have to refinance the mortgage loan since this is the only way to remove a co-borrower’s name from the loan.

Can you afford your home?

Lenders will look at your income to determine if you can afford the new mortgage on your own. The mortgage payment cannot be more than 28 percent to 30 percent of your gross income, and your total monthly debt payments cannot exceed 43 percent of your gross income. Your child support and alimony will be factored in as well.

Is your credit strong enough?

You will need to meet the lenders credit score requirements. You need to have a credit score of at least 620 to qualify but that score is on the low end and you will likely be at a higher interest rate with a higher payment than if you had a higher credit score. With a good credit score, over 700, you will be looking at a significantly lower monthly payment.

If your credit score is poor and you aren’t yet able to refinance, you can work out a deal with your ex to allow you to keep making the payments until your credit is repaired. This could take anywhere from six months to a year depending on what is on your credit report. You can then re-apply for to refinance.

There are many credit repair companies out there. Be sure to do your due diligence when seeking a credit repair company. The average price for this type of service is around $600.

Lastly, the quit claim deed.

If you’re able to refinance and remove your spouse’s name from the mortgage loan, he or she also needs to sign a quit claim deed, which transfers ownership of the property to you. Refinancing takes a name off the mortgage loan, but not the title.

If you have any questions regarding your home when getting a divorce, please give one of our Mortgage Professionals a call at 763-416-2600.

Posted 07/16/2015

neighborhood

If you are in the midst of buying a home with a Home Owners Association (HOA), you may want to dive deep into finding out what it all entails and decide if this is something you’re comfortable living with.

The primary purpose of a homeowners association is to manage a neighborhood’s common areas such as roads, parks and pools. HOA’s also set out certain rules that all residents must follow called covenants, conditions and restrictions (CC&Rs).

Although the intent of an HOA is good, it can really come between you and your freedom to live the way you desire. If you don’t abide by the rules, you will find yourself hit with a fine and in some cases, in court.

Are you the type of person who doesn’t like rules?

There are typically plenty of rules to live by in an association. What if you want to paint your front door red or park your boat in the driveway? You will find that most HOA’s will determine what color of door is acceptable and whether you can park your boat in your driveway. If you are Mr. or Mrs. Independent, a Home Owners Association may not be the best bet for you.

What are the rules?

Maybe you can live with rules. Contact the HOA and get a copy of the rules or look online for them. You will want to know what they are and the penalty for breaking a rule.  Rules can also change throughout time and what was once acceptable may not be anymore. So you will want to be on the lookout for notices of changes made to avoid fines.

Is the home in compliance with the current HOA guidelines?

If you don’t want unexpected out-of-pocket expenses, be sure that the home is up to par with the rules.  Obtain a copy of the HOA guidelines to avoid the mistake of buying a home that can potentially cost you money just to get it to the HOA standards.

Assess environmental practices

If you are environmentally conscience and want to put in a compost and/or solar panels, you may find that they are not allowed.  Because there may be a standard for everyone to have picture perfect lawns, you may forced to used pesticides and fertilizers that go completely against your dedication to be environmentally responsible.

How much are the fees and how are they structured?

Check out how much the fees are, how they are set, and how often increases take place. You should have access to the history of the HOA dues for the past 5-10 years. Ask for a record of special assessments that have been made in the past and ask if any special assessments are planned for the near future.

You will also want to know what is covered in the monthly dues. Don’t assume garbage pickup is covered just because a friend’s HOA covers theirs.

Who’s in charge?

Oh boy, can this be important! Hope the person in charge is a reasonable person and not a dictator. If you like the neighborhood and home, you may want to talk to one of your future neighbors to get the skinny. You also don’t want to end up with someone who doesn’t respond to issues and doesn’t take the position serious.

For your mortgage needs, give us a call at 763-416-2600 and speak to one of our Mortgage Consultants.

 

 

 

 

 

 

 

Posted 07/15/2015

Bank Owned Foreclosure.

Buying a home in foreclosure seems like a great way to get a steal of a deal on a home.  But be aware that there are risk involved and the unforeseen can turn your gem of a deal into the money pit.

Here are some helpful tips to purchasing a foreclosed home.

Buy from a Real Estate Professional:

Buying strictly through an auction, “sight unseen” or only being able to see through the windows can be very risky. Without going inside and having the home inspected by a professional before taking ownership, you can’t know for sure what you are buying into.

It is not unheard of for homeowners to become angry when evicted out of their home to leave a path of destruction, putting holes in walls, pulling out appliances, light fixtures and ripping out carpet.  You can be looking at electrical issues, plumbing and replacing carpeting, etc.

With a real estate professional, you can actually tour the home and have an inspection performed.

Know what it will cost to make the home livable:

Foreclosed homes may sit for long periods of time with no maintenance. At this point, lawns may be reduced to overgrown weeds, peeling paint on the home, water stains, leaks and more.

Additionally, if it is a home that was destroyed by the disgruntled home owners, there could be some bigger costs for repairs.  Be sure to add an additional 10 – 20% on top of the bid for repairs. There almost always seems to be more issues than meets the eye.

Know the value of similar homes that sold in the neighborhood:

For negotiating power, you’ll need to know what similar homes sold for in the neighborhood.  You can find this information through real estate sites like Zillow and Realtor.com.  This will give you an idea of price per square foot and what range you should be in.

Get pre-approved and know lending restrictions on foreclosures:

If you’re serious about buying a foreclosed home or any home for that matter, get pre-approved before you do anything. This will allow you to know how much home you can afford. Too many times buyers get ahead of themselves, find a home they want to buy only to find out it is out of their price range.  This will also give you a stronger position proving that you are a serious buyer.

When buying foreclosed homes that will need repairs whether major or minor, you may possibly need to find a rehabilitation loan. There are restrictions on most of these loans so it is important to see what your lender offers. Ask questions and be very clear on the terms.

Be sure to spend quality time with your Mortgage Consultant. You must fully understand purchasing foreclosures and the restrictions of the financing. Give us a call at 763-416-2600 to speak to one of our experts about your mortgage needs. Or visit us at www.muihomeloans.com.

 

 

 

 

Posted 07/08/2015

Happy Couple Dream New Home

Do you think you are prepared to buy a home?

I’m sure you have your list of must haves for the home you want to purchase. But what about being prepared financially and the maturity to own your own home? Below is a checklist of things to consider.

Know Your Budget
To be a good budget-er, you will know what’s coming in and what’s going out monthly. Surprisingly, not everyone has this skill. But with some commitment to focus on being cognizant of money coming in and money going out, you will soon have that under control. You will also be shocked at how much money you spend on unnecessary things (daily Starbucks?)  Be sure to have control of your debt before moving forward to purchase a home.

What’s more important to you?

This is a commitment to a debt, maintaining your home and maintaining your yard. This is a long term relationship! If you are the type of person that is still wanting to travel for long periods of time which requires money and being away from home, will you be able to pay your mortgage and maintain your home?
What about the all those shoes and purses you like to buy? Will that fit in with your new set of bills? It’s like having kids. Their needs come first and you may have to give up your affinity of designer purses. A house is much the same. It is a priority to pay your mortgage and maintain your home.

If you are beyond the days of being a free spirit and are ready to make some sacrifices, you may be ready to settle down into your own place.

Maintaining Your Home

People underestimate the responsibility of maintaining a home. Are you ready to mow your own lawn, take care of the landscaping, shovel your own driveway, repair or replace appliances in the event they break down? Do the monthly maintenances like changing out filters and adding salt to the water softener? There’s a laundry list to maintaining a home. If you let these things go, the cost to repair or replace can be very expensive.
When you own your home, you won’t have a landlord to depend on. When anything breaks or wears out, it will be your responsibility to fix it. And you’ll have to pay for it too.

Truly, this is a big responsibility and you must be willing to take it on.

Emergency funds

If you were to lose your job, have to replace your transmission in your car or become ill and need some time off of work, do you have a decent size savings to get your through the months to come? Rule of thumb is you should have 6 months of your personal expenses put aside. Put this money in a savings account or money market account as to have easy access if needed.

Is your income reliable? 

You should have a stable income as well as at least one to two years of employment history at your current job. As mentioned earlier, this is a long term relationship. You need to feel confident that you’ll be able to afford your mortgage payment a year from now to 10 to 20 years from now.

Must have a decent credit score

Most mortgage companies have a minimum credit requirement to obtain a mortgage. Getting a mortgage with a poor credit score may mean a higher interest rate, and that you’ll end up paying more over the life of your loan. Good credit will mean you will pay less to own your home vs. the higher interest rate you’d get with a lower credit score. It may be worth waiting and getting your credit repaired if you don’t have a good credit score.

Down Payment

Making a down payment reduces the size of the principal of your loan while also reducing the monthly mortgage payment. A large down payment may also qualify you for a better interest rate, since there is less principal to finance. A down payment also gives you equity in your home from day one.

Buying a house is serious business. You must be fully prepared. The tips provided are definitely things you must consider before purchasing a home. No one wants to be a prisoner of their home. Be sure that you can still live your life and enjoy the things that bring happiness to you.

At Mortgages Unlimited, our Mortgage Consultants can sit down with you and go through all the necessary steps to becoming a homeowner. Many of our consultants are very knowledgeable and could provide answers to all your mortgage questions. Call us at 763-416-2600.

7365 Kirkwood Court N, Ste 300 Maple Grove, MN 55369 NMLS Lic #225504

P: 763.416.2600 F: 763.420.5885

© Copyright 2017 Mortgages Unlimited |  visit our website